TaxTMI 
TaxTMI 
1998 (7) TMI 281
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....ermined Assessable value Customs import duty levied and paid Rs.   Rs.   1. Piston valves 84.61(1)    22,265.00 25,493.43 2. Sleeves spring holders 73.33/40(1) 15,554.00 24,653.09 3. Screws 73.32      95.00    119.43    4. Gland carrier Ring 84.03      71,487.00 54,330.12 Total : 1,09,401.00 1,04,596.07 There is no dispute in this appeal pertaining to Item (4) above. 4. It is the appellant's case that all the individuals spares are specially designed and intended to suit and use in their mills and therefore, they applied for reclassification of the goods under Chapter Heading 84.03 and for refund of excess customs duty of Rs. 45,519.53. It was their further plea before the Asstt. Collector that the goods by their very nature are spares for turbines, and are not assessable under any other tariff item other than Item 84.03 of the Customs Tariff. The Asstt. Collector held that as the items have been invoiced separately and declared as....
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....arts ends is not an appropriate heading as the item is not a general purpose scrutiny but manufactured as per the drawing and specification and tailor made for valves as parts of the turbine. Therefore, he submitted that the items are to be classified as parts of turbine to be under Heading 84.32. 7. Ld. DR submitted that the Note 1(g) of Section XVI is applicable to the facts of the case irrespective of the use of sleeves, spring holders and screws and they have been rightly classified as such. He also referred to Note 2 of Section XV and submitted that it has to be read to understand what a part of general notes. He submitted that it refers to sleeves springs etc. and being of general notes has to be classified on merits. He relied on the ratio of the judgment rendered in the case of Gordon Woodroffe & Co. v. Collector of Customs as reported in 1987 (27) E.L.T. 99 and that of Vardhman Spinning & General Mills v. Collector of Customs as reported in 1991 (53) E.L.T. 79, wherein it has been held that spring sleeves holders even of their parts are required to be classified on merits. Ld. Advocate countering the arguments submitted that these judgments are not applicable as th....
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....ate of duty, the appellants claimed for refund on this item is required to be accepted. As regards the classification of Sleeves spring holders, the department has proceeded to classify the same as articles of iron or steel, not elsewhere specified. The appellant's contention is that there are tailor made and they have been specifically got manufactured from the suppliers as per the drawings and specifications. Therefore, it is their contention that the item has got to be classified as part and parcel of the main item i.e. turbine by application of Note 2 of Section XVI. There is force in the submissions made by the appellants in this case. The item is not a general purpose article of iron or steel but it is specifically designed and tailor made for use in the turbine as the spare parts. Therefore, by application of Note 2 of Section XVI, the item is required to be classified alongwith the main item i.e. turbine as being suitable for use solely or principally with a particular kind of machine. Ld. DR relied on Note 1(g) of Section XVI which states that parts of general use, as refund in Note 2 of Section XV of base metal, "Section XV", are similar goods of artificial plastic mat....
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....s that the goods are turbine spare parts manufactured specifically for metropolitan vickers turbines. 13. The A.C. has rejected the claim for want of catalogue. The ld. Counsel has stated that there is no question of catalogue as the items have been manufactured as per their designs and the drawings had been furnished. 14. It is however, not clear that in view of the goods having been described as spare parts for turbines how and why a classification under 84.03 had been claimed; because Heading 84.03 as it stood during the relevant time, covered only generator such as 'Producer gas, water gas, acetylene gas and similar gas generators' and not Turbines or parts thereof; Whereas various types of Turbines were classifiable in those days under 84.07 and 84.08. 15. Again the piston valves have been classified under Heading 84.61 (1) by the department but the ld. Advocate has stated that they were prepared to accept classification under 84.61 (2) in view of the Tribunal's order in the case of Kerala State Electricity Board - 1995 (80) E.L.T. 346. 16. I am however, of the opinion that Heading 84.61 itself was not applicable. In the Tribunal's order in the case ....
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....ons made before us by both the sides regarding the springs and their classification are not relevant and these citations are also not applicable. 20. Even otherwise Chapter 73 covers only articles of iron and steel, and in the case of these springs holders while it has been indicated that they were not made of stainless steel it has not been mentioned as to of what metal they were made. 21. In so far as the screws are concerned again screws would fall under 73.32 only if they were made of iron and steel and not otherwise but the metal has not been indicated. 22. There is yet another problem. Although in the working sheet the piston valves, the sleeves and spring holders and screws have been shown as spares for 7.5 M.V. Turbine yet in the application for refund of import duty dated 1st Dec. 1983 (at internal page 3) 'Plunger and sleeve for relay gear' '(i.e. piston valve, sleeve, spring holder, screws)' have been shown as spares "required for turbo generators" and not for Turbines as such. That generators are different from `Turbines', is well known. The Webster's New Collegiate Dictionary shows that : 1. Turbine is "a rotary engine actuated by the r....
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....whereas other parts will have to be re-classified depending upon which type of generator the appellants have. The screws if made of iron and steel of course are classifiable under 73.32 but the sub-heading would depend upon the fact as to whether they are of iron or steel. The rest of the items will have to be re-classified as parts of generator. 26. It is also significant that before the ld. Collector (Appeals), Engineer of the firm submits that these items were manufactured according to separate work orders but assembled together at the time of despatch and were intended to be used outside the turbine control mechanism and is essentially a part of the turbine control. 27. The ld. Counsel has discarded this submission at the time of hearing before us. But in view of the above discrepancies and differences in description and submissions at various stages, I am not surprised if the ld. Collector came to the view that the appellants have not been able to show that subject goods constituted sub-assemblies or were essential parts of the turbine themselves. 28. Since, verification of factual aspects is involved and the material placed before us is not sufficient ....
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....rly has been accepted as sub-assembly while in respect of the second item which is the item in question the individual parts which are listed under the heading sub-assembly Plunger and Sleeve for Relay Gear have been taken into reckoning for classification and assessment purposes individually. He has pleaded that the consolidated value has been shown against both the items which have been charged for under this invoice. The plea is that this would clearly go to show that what was imported was sub-assembly and not individual items for assembly. He has pleaded that this point was omitted to be mentioned before the Tribunal at the time of hearing and as a result of this omission the issue came to be considered by the Tribunal treating the import of the components individually. He has pleaded now that they have requisite evidence by way of invoice, the classification of the goods imported may be considered taking into consideration that what was imported was sub-assembly and not individual parts. He has prayed that the matter may be referred back to the Bench which earlier heard the matter. 31. The learned SDR for the Department after perusing the invoice accepts this position ....
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....n view of the difference of opinion the matter was submitted to the Hon. President who referred it to a third Member. During the hearing before the third Member the appellant wanted to raise a new point and produce documents and to request that they may also be taken into consideration by the Tribunal while deciding the matter. 33. The Hon. third Member has recorded the proceedings before him and thereafter referred the matter back to the original bench. Accordingly this bench has been constituted and the matter has been placed before us. 34. We have considered this matter. We find that the appellants have sent a letter dated 19-11-1997 praying that the matter may be decided on merits. We have therefore considered this matter in the presence of the ld. DR who has been allowed to peruse the record of proceedings before the third Member along with the latters observations. 35. Ld. DR has stated that since the Madras DR has already made submissions before the third Member he has nothing further to add. 36. We have considered the matter. We observe that it is evident from the record of proceedings before the third Member that admittedly a new point was r....
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.... Heard ld. Advocate Shri K. Narasimhan for the appellants. He submitted that the matter is awaiting a decision since long. Therefore justice delayed is justice denied is a phrase which aptly applies to this case. He further submitted that there is an error apparent on record in para 13, Page No. 7 of Hon'ble Vice President Shri S.K. Bhatnagar's order wherein it has been noted that various types of turbines were classifiable in those days under chapter Heading 84.07 and 84.08. Ld. Advocate submitted that this is factually incorrect as they were at the relevant time classified under the relevant tariff under Headings 84.04/84.05. He further submitted that as recorded by Hon'ble Vice President Shri V.P. Gulati (retired) the issue regarding consideration of the evidence available in the form of first invoice and the argument that the second invoice should be also considered in the light of this evidence could not be submitted during the first hearing before the Bench because no occasion arose to do so. However, since this is a strong evidence in favour of the appellants, therefore it cannot be brushed aside also, else there would be miscarriage of justice. 41. Heard ld. S.....